The Federal Reserve held interest rates steady Thursday, but its strong assessment of the economy had investors worried about future rate hikes. The Dow Jones Industrial Average (DJINDICES:^DJI) turned positive in the last minute of trading and the S&P 500 (SNPINDEX:^SPX) closed down.
Today's stock market
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Energy stocks fell on falling crude oil prices; the SPDR S&P Oil & Gas Exploration & Production ETF (NYSEMKT:XOP) dropped 3.7%. Retail was a bright spot, with the SPDR S&P Retail ETF (NYSEMKT:XRT) closing up 1.2%.
Tesla appoints new chair
Tesla named Robyn Denholm to replace Elon Musk as chair of the company's board of directors, and shares edged up 0.9%. Denholm, an independent member of Tesla's board since 2014, is moving into the position to meet the stipulations of a settlement with the Securities and Exchange Commission, which required Musk to step down as chairman for a minimum of three years while allowing him to remain as CEO.
Denholm is chief financial officer and head of strategy at Telstra, Australia's largest telecommunications company, where she was widely regarded as the likely successor to the current CEO. After a six-month transition, she will leave that position and will serve as Tesla's chair full time.
The SEC forced the move in order to provide oversight for Musk's communications, but Denholm will bring some important experience that should enhance Tesla's leadership team in other ways, too. She is viewed as having helped turn around Juniper Networks as that company's chief financial and operations officer, and had over six years of automotive industry experience at Toyota Australia.
Weak guidance hurts Roku shares
Streaming media device maker Roku delivered results for the third quarter that beat expectations, but weak profit guidance for the fourth quarter resulted in the shares plunging 22.3%. Revenue increased 39% to $173.4 million, above the $170.4 million analysts were expecting. The company had a loss of $0.09 per share, which was less than the $0.12-per-share loss that was expected.
Hardware player revenue increased 9% and the more lucrative platform segment, which is comprised mostly of Roku's advertising business, had a revenue gain of 74% to $100.1 million. Active accounts grew 43% and streaming hours increased 63%. Gross margin improved 5.6 percentage points to 45.6%.
Roku boosted its full-year revenue outlook about 1% at the midpoint and gave Q4 revenue guidance roughly in line with what analysts were expecting. But guidance for Q4 net income of between a loss of $4 million and profit of $3 million didn't compare well with the expectations of analysts, who were all expecting breakeven or better.